LABOR'S plan to abolish negative gearing as we know it and double capital gains tax paid will hurt every Australian. If you own your home it will be worth less. And if you rent you will pay more.

Investors today hold around a quarter of the 10 million dwellings that make up the $6 trillion Australian housing market. But under Labor's big new property tax there will be less incentive for investors to buy property, creating downward pressure on prices.

Reducing the number of investors in the market also pushes up rents. Investors often accept lower rents in the expectation of future after-tax capital gains when they sell.

Labor's policy could not come at a worse time for the housing market as prices have reduced across capital cities, including Sydney. Labor's changes will smash property values and undermine confidence in the stability of the market.

Their excuse is that they want to improve the opportunities for first-home buyers to gain access to the market. But that is already happening without changes to negative gearing, with over 100,000 first-home buyers getting loan approvals over the last year, the highest number since 2009.

Labor also claims that negative gearing is the domain of the so called "rich" and people with multiple investment properties. Again, the facts tell a different story. Two-thirds of those who negative gear have a taxable income of less than $80,000 and over 70 per cent of those who negatively gear have only one property. In fact, the annual deduction claimed by those who negative gear is less than $10,000 in seven out of 10 cases.

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Labor should listen to the critics of its policy, says the Treasurer.

Labor's "rich" negative gearers include 58,000 teachers, 41,000 nurses, 19,000 police and emergency service personnel. Not only is Labor hurting families right across the country but it's attacking those aspirational Australians in its heartland.

Labor's policy also risks sending home buyers into a position of negative equity, when the value of their home falls below the size of their mortgage. This not only impacts household wealth, but can also deter future buyers, shaking their confidence about entering the market.

Unfortunately when Labor's frontbenchers try to justify their new property tax, they get caught out.

Bill Shorten and Chris Bowen have said Labor's property tax will decrease housing prices, but opposition finance spokesman Jim Chalmers has said that prices will increase, while Joel Fitzgibbon says prices will neither go up, or down under Labor. What a shambles!

With unemployment falling to five per cent and GDP growth increasing to 3.4 per cent, it's fastest rate since the height of the mining boom in 2012, the last thing the country now needs is a big new property tax.

Labor should listen to the critics of its policy, cut its losses and abandon the changes to negative gearing and capital gains tax.

Chris Bowen has said in recent days Labor will take the policy unchanged to the election. This would be a mistake and cause significant damage to Australia's housing market.

The more desperate a government becomes the shriller scare campaigns tend to get, which is exactly what we are seeing with the Liberal Party's renewed attacks on Labor's responsible negative gearing reforms.

The housing market has been a source of great frustration for younger families in places like Sydney. Home ownership is at its lowest point across Australia in 60 years. The Labor Party recognises this. The Liberal Party doesn't. They are simply out of touch.

Wealthier investors get a subsidy from the government while first home buyers get locked out, says Chris Bowen.

Labor's policy to restrict negative gearing to new homes will level the playing field so first home buyers and young Australians can realise the great Australian dream of owning their own home.

Labor wants to level the playing field so first homeowners don't have to compete with investors that in Australia have some of the most generous housing tax concessions in the developed world.

Labor's reforms are fully grandfathered which means that everyone that has a negatively geared investment property today will be completely unaffected by our changes.

The government wants you to believe they're standing up for battlers and working-class Australians.

But the fastest growing cohorts of people with negatively geared investment properties are those with three, four, five and six properties. The most generous tax concessions in the developed world mean wealthier investors get a subsidy from the government while first home buyers get locked out. How is that fair?

Labor reforms will put first home buyers back on a level playing field, Chris Bowen says. Picture: Alix Sweeney

We prefer to invest in better hospitals, schools and TAFE than spend taxpayers' money helping a property speculator with their sixth or seventh investment property.

The government argues with a straight face that Labor's changes will take a "sledgehammer" to house prices at the same time that house prices in Sydney have just notched up the largest yearly fall in decades.

So price falls under the Liberal Party we're seeing now are good but any possible falls under Labor are bad? You simply can't make this stuff up.

When attacking Labor's responsible reforms, the government relies on its mates from the property sector and vested interests.

Meanwhile, Labor relies on independent experts. Well respected independent economists such as Saul Eslake have rightly said that reforming negative gearing would remove a source of upward pressure while analysis done by the Grattan Institute shows Labor's policies will have only a modest impact on prices.

This follows Treasury analysis that the government tried to conceal, which advised the government that Labor's changes would have only modest impacts.

Labor's reforms are good for home ownership, good for the budget and will make the tax system fairer. Our reforms will put first home buyers back on a level playing field. It will be left to a Labor government to improve housing affordability for all Australians.